ABSTRACT: Paper examines the positive and negative impacts of the Internet on costs and productivity in libraries. The Internet can simultaneously have positive and negative impacts in both areas. It is necessary to identify both actual and opportunity costs. The nature of these costs is explored, and the significant savings which can be achieved are detailed. The impact of use and misuse on staff productivity is discussed. The origins of questionable beliefs are examined and careful and sceptical management is recommended.

The bottom line is the total cost of delivery of a service, expressed as dollars. It is a partial measure of efficiency. The other half of the equation is productivity [1].

The paradox of the Internet is that it can deliver improvements to the library's bottom line in terms of reduced or offset costs and improved productivity, and equally, and invariably simultaneously, can increase costs and decrease productivity.

The reality of the Internet is that it is a mega-network, a matrix of smaller networks which has created a new work environment. The word matrix has its root in the Latin for mother, so it is perhaps appropriate that this new work environment can be both hard task master and indulgent parent.

In many libraries the true cost of Internet provision, access, and use is not known because those libraries are unable to identify and describe specific costs, is thought to be unimporta nt or is not made explicit for reasons which may be overt or covert. It is important that understanding of the true costs of all services is not restricted to library managers. Such understanding is a critical requirement for accuracy in cost-benefit analyses, and should therefore be shared by all staff. Shared understanding is particularly important in assessing the impact of the Net on the bottom line because of the near-endemic level of born-again faith in the Net's efficacy and efficiency.

A multiplicity of variables renders use of anecdotal information relating to costs is insufficient. The nature and range of costs pertaining to an individual library must be known in order to answer questions such as: What is the real cost (including all staff costs) of a reference title, including administration costs of acquisition and payment, cataloguing, processing, housing, weeding and replacement? How often is it used, and how does the cost per use compare with the cost per access to its on-line equivalent? What is the cost differential between obtaining an item on inter-library loan and obtaining it from an on-line supplier? How do both of these compare with permanently acquiring the item?

Costs fall into two categories: actual costs which can be offset by actual savings, and opportunity costs, which cannot. Opportunity costs, the cost of opportunities forgone, however, may be accepted as a result of a strategic decision to expend resources on an alternative which returns a greater benefit, or is deemed to be more politically expedient.

The library's ability to identify the opportunity costs of its Internet use requires comprehensive assessment of all productivity issues, and the ability to put a realistic dollar value on those activities and outputs foregone as a result of Internet-related use (or misuse) of resources, including staff skills and time.

Actual costs can be further subdivided:

• Planning, management, and staffing.
• Hardware (acquisition and maintenance)
• Facilities alteration and maintenance (everything from re-wiring to ergonomic furniture).
• Software.
• Communications
• Training
• Content and resource development.
• User education

The library's ability to comprehensively identify the actual costs of its Internet use is an output of the library's performance measurement system, and of its budgetary system. Technology allows libraries to budget differently. The access versus ownership debate has been going for some time. Initially the debate was focused on expensive indexing services, now it is focussing on standard reference material. Access is quite different from ownership, and there are arguments for and against both, but access (rapidly becoming focussed on the Internet) is apparently cheaper.

If direct comparison is made between the cost of purchasing an expensive reference source and providing access to a remote electronic database containing the same information, the total cost for all accesses to the database is likely to be cheaper. Factor in the infrastructure and training costs and a different picture might emerge. This is not to say that it is unreasonable then to select the access option over ownership, however the way the budget is constructed, cost centres nominated and financial and cost information disaggregated may obscure the financial realities. In particular, hardware and software costs can represent major portions of the library budget and the major time comm itment on the part of staff in developing and maintaining competency in working with the Internet represents a significant imposte on intellectual and professional resources.

Impact on productivity

Peter Drucker has noted that 'value is now created by productivity, innovation, and knowledge workers' (Drucker 1993). It is axiomatic among managers that technology increases productivity. This is an article of faith that requires a reality check. Productivity, as a general measure, suggests that the more that is accomplished per unit cost (for example the salary of a staff member), the higher the productivity. Work load and productivity may not necessarily be the same thing. Technology, properly used, increases productivity. This is why we replaced manual typewriters with word-processors and word-processors with PCs. But there is no productivity gain if there is no increase in output of that work which goes directly to the purpose of the staff position in question.

To continue the manual typewriter-PC analogy: if the typist spends the time gained as a result of minimising of retyping, ease of correction of errors and use of mail-merge facilities, on personalising the display and moving files around in the file-manager, the only "gain" may be a personal perception of work well done and a feeling of virtue. It has been said that computers are a wonderful device for wasting time that otherwise would be difficult to waste. The Internet is probably the ultimate expression of this opportunity.

Productivity loss must be expected during, and for a period after, implementation of a new technology. My personal observation in my own library service is that approximately 200 hours of use is required to develop any sort of facility with searching for information on the Internet. Presuming a 35 hour week, 13 paid public holidays, and 4 weeks annual leave, this represents more than 12.5% of the annual input of a staff member. Efficient and effective use of the Internet as an information source requires a level of expertise that takes considerable training and practice, both initial and ongoing, to develop and maintain competence. Learning is the new form of labour (Zuboff, 1994: 395), but it is a form of labour that is generally not allowed for in assessment of staffing requirements.

The World Wide Web is deceptively simple to use. Instructions for its use can be reduced to two steps:

• Step One: Click on any text [roughly equivalent to clicking together the heels of a pair of ruby slippers programmed in reverse]
  
• Step Two: Explore

In reality, there is a third step:

• Repeat steps One and Two until you haven't a clue where Kansas is or how to get back there, at which time, give up or call for help.

Where Internet access is provided for library users, this third step is an additional impact on staff productivity. Staff are required to deliver to users, on demand, informal training and/or suffer the increased imposte of accessing specific resources on behalf of users. Pointing a user to a specific reference book as an appropriate source to answer a factual question, and leaving the user to it, will generally provide the information required. Telling a user that the information can be found "on the Internet", particularly if that user is not computer literate, can be tantamount to denying service. The Library at Purdue University estimates that its Information System has effectively doubled the work- load, when user education in use of it is factored in (Koopman and Hay).

Under-realisation of potential productivity gains if the technology is not fully exploited can be considerable, though hidden. Hundreds of studies carried out by software companies suggest that most users use between ten and fifteen percent of the capabilities of the technology they use. Most users do not go beyond the absolute basics. In addition, aspects of human physiology and cognition limit the productivity potential of digital info rmation sources.

Problems of readability negatively impact on speed and comprehension and relate to three characteristics of electronic displays:

Electronic displays use transmitted light. Instead of reading a surface from which light is being reflected (hardcopy) the reader has a light shining from the screen directly in the eyes . This is inherently more tiring, and therefore the reader of a transmitted-light text will read fewer words a minute, will read for a shorter time, and will suffer more headaches.

Electronic displays have much lower resolution than the printed page. Electronic displays resolve at approximately 1,200 times fewer elements for equivalent area than top quality publications such as art books. A page printed on an average quality laser printer resolves at about fifteen times the elements of the equivalent are on a screen. Electronic text is not as easy on the eyes, and the mind has to do extra work to resolve the dots (which it sees subliminally) into characters and words.

Electronic displays present less on the screen than is contained on the average printed page, unless you have an expensive monitor designed for desk-top publishing.

Where a specific passage is being sought and read for specific informational purposes the screen will be much faster than the printed page thanks to available "Find" facilities . Hypertext makes text accessible at the paragraph level, with user- defined links to other paragraphs. Peter Lyman, in conjunction with the educational publisher, McGraw Hill, studied the way students used standard textbooks when they were presented electronically (the Primus project). One of this project's major findings was that the assumption that the unit of knowledge was the article or chapter was wrong. The unit of knowledge turned out to be the paragraph. It was found that rather than using the text sequentially, students made full use of the electronic capacity and skipped backwards and forwards in defiance of any narrative form in which knowledge is cumulative. It would seem that electronic communication is best for giving access to data and small, discrete packets of textual, numeric, and visual information, and that staff attempting to read sustained narrative will be less efficient than if they had used hardcopy. Speed of sustained reading from a screen has been estimated to be as slow as two -thirds the speed of reading print hardcopy and skimming or browsing can be slower by a factor of three or more.

Moving from print to electronic text requires a cognitive shift. The electronic text is a different medium for construction and mapping reality in order to create meaning. (Lepani: 1996)

Overall library service levels can also be depressed by unwitting duplication of effort resulting from apparent ease of use and the tendency not to ensure that an audit trail is created; and by "dumbwork" - brainless tasks which do not contribute to service delivery.

Australian libraries now have a legal obligation to carry out the dumbwork of ensuring that censorship laws relating to the Internet are not transgressed.

Access to the Internet (particularly individual desk-top access) can seduce even dedicated workers into spending far too much time on activities such as reading trivial e-mail.

Significant increases in productivity can be achieved in communications due to the removal of waiting impediments and additional tasks related to synchronous communication (phone), and timelags relating to traditional forms of asynchronous information (mail). E-mail is quicker to produce and send than fax, and does not incorporate the risks relating to single copy means of communication (fax or mail) nor the effort to produce a document, send it, and file a copy.

Impact on costs

The Internet has abbreviated time and space, resulting in increased opportunities for libraries, individually or in consortia to develop, build, maintain, market and generate income from repackaging information. Documents do not have to exist as files, they can be generated by a server in response to a query, or to a document name.

Conventional wisdom within the business environment is that it takes $20 worth of sales to deliver to the bottom line the equivalent of $1 in cost savings. The opportunities the Internet delivers to reduce or blow out costs, are, however, complex and difficult to manage.

Though not generally costed on a per item basis, the cumulative value of the space required to house library resources can represent significant capital and recurrent costs. A "coll ection" of digital resources, distributed on remote servers and accessed as required, requires no more space than that required for the PC which is used to access it, regardless of the size or rate of growth of this collection. Space related to digital collections is truly a fixed cost.

Responsiveness, or lack of it, results in increased costs both to the library and to the library user. While it is impossible for any library to accurately define the cost to its users of delays in providing required information and resources, dealing with repeated inquiries about non-receipt of requested resources absorbs staff time and frustrates users.

There are a number of ways in which use of the Internet can be integrated into the workflow. Such integration will deliver productivity increases and cost reductions relating to communication activity.

Accessing ABN and/or telnetting to relevant library's catalogues and following up with an e-mail, or using commercial document delivery services can increase responsiveness and reduce costs in delivering an inter-library loan services.

Significant efficiencies can be realised in Acquisitions. While full electronic data interchange (EDI) facilities are not yet available via the Internet, telnetting to supplier databases provides immediate access to information not sourced in other standard bibliographic tools. This reduces the time needed to make personal contact with suppliers, aids decision- making about document delivery (purchase vs inter-library loan). The capacity to establish a personal contact with overseas publishers via e-mail means ordering directly from the publisher becomes a viable option for obtaining material with a limited distribution, advantage can be taken of membership discounts available through se rial subscriptions, and savings can be made by not incurring special order charges which might be levied by Australian library suppliers.

Part of the cost savings in acquisitions, inter-library loans or document delivery, are communications saving. Use of the Internet is considerably cheaper than the alternatives for acces sing remote databases, sending or retrieving files, or corresponding with remote users, suppliers or colleagues. Though a less formal means of communication, perhaps more analogous to speech than to correspondence, e-mail has the advantage of providing bo th parties with a record which can be archived, retrieved, copied and resent, all with a minimum of key-strokes, so it delivers both cost-savings and productivity gains if properly used.

Marketing The past twelve months has seen wholesale entry of commercial entities, particularly small businesses, to the World Wide Web. These organisations have understood the potential of the Web in marketing their products and services.

It is focus on the customer, rather than focus on the product that distinguishes marketing from other market orientations. The steps involved in marketing are:

• identifying customer needs
• developing a service or product to meet those needs
• deciding how the product or service is to be made available given the objectives of the organisation
• communicating and promoting the service or product
• making the product or service conveniently available
• ensuring that the customer is satisfied with the service or product.

Marketing relies heavily on designing library services and collections in terms of the target markets' needs and desires, and on using effective pricing, communication, and distribution to inform, motivate and serve these markets. Both the Web and e-mail have potential to be used effectively for all aspects of marketing and to deliver savings relating to marketing activities.

An emerging option for research design formats is the use of e-mail and the Internet. Surveys can be conducted by e-mail, and virtual focus groups convened on the Internet. While at present participation may largely be restricted to the young, and the computer-literate, in some sectors, specifically the corporate and academic, e-mail access to the majority of the library's actual and potential users is already possible.

Use of e-mail can dramatically reduce the cost of distribution and return of mail surveys. Depending on the survey design, e- mail returns can reduce the cost of analysis because the information is in electronic form. Use of e-mail also results in reduced cost sensitivity to sample size.

Much library promotion has traditionally been via printed matter, including flyers, posters, and newsletters. In addition, libraries publish a multiplicity of materials, including those, such as bibliographies and reading lists, which are distributed free. While transferring from paper to electronic publishing may seem attractive, and in the corporate environment has proven very cost-effective, all the processes of publishing, with the exception of printing and distribution, will continue to be required, so the savings may be modest. However, the capacity of the medium to allow dynamic rather than static publication, at far less cost than withdrawing, updating and re-releasing print materials, represents considerable cost-saving, as does the elimination of over or under estimating print runs.

Benchmarking

Though benchmarking is generally defined as a process of comparing your own organisation's performance with that of other organisations, it is, in reality, outsourcing research. The wider you cast your net in this outsourcing process, the more likely you are to find relevant information about the process or action you are benchmarking. Particularly for micro- benchmarking (my own term) , where a single action rather than a complicated process is involved, use of listservs can be a cost-effective mean s of identifying how others have approached an issue and of garnering information on which to base decisions on how to proceed to improve performance. Not only will answers sought arrive speedily, and at minimal cost, but, the incestuous cycle of comparin g only with local and known collegues will be broken. Micro-benchmarking via the Net has enormous possibilities for both increasing productivity and reducing costs of a multiplicity of aspects of library management and service provision. In addition, as a n activity in itself, use of the net for micro-benchmarking and for identifying suitable partners for macro-benchmarking of whole processes, will deliver reduced benchmarking costs and increased productivity of those carrying out the investigation.

Conclusion:

As the technology evolves and the management and auditing requirements of parent institutions change, a number of emerging possibilities will evolve into real opportunities to contain costs. For example fully-fledged EDI services will be able to use the Internet as a carrier and geography will become increasing less of a barrier to outsourcing of non-core functions.

What will not change is the need to ensure that careful and accurate cost-benefit analyses are carried out before implementing changes, and careful and accurate monitoring of costs and results is in place. It is the intersection of the cost categories and the level of involvement of the library with the Internet that will continue to drive the Internet's impact on the bottom line. Achieving identifiable benefits to a library's bottom lin e requires careful and sceptical management of individual and corporate use of the Internet.

Careful management is required, because the medium itself is seductive and it is easy to fall into the trap of forgetting that it is simpler, and quicker, to open up the local phone book than to access it on-line. It is also easy to feel that you are working when in reality you are playing. Surfing may be fun, but it is well to remember that it is a sport, both in cyberspace and at the beach, in which success is measured by how fast you can skim over the surface. Professional librarianship, however, implies something more than a superficial relationship with information and information sources.

Sceptical management is required because, as Artemus Ward has reminded us, 'It ain't so much the things we don't know that get us into trouble, It's the things we know that just ain't so '. Librarians are in no wise immune to holding questionable beliefs. We, too, tend to see in random data regularity and order where only the vagaries of chance are operating. We, too, have limited ability to detect and correct for biases in incomplete and unrepresentative data. We, too, are eager to interpret ambiguous and inconsistent data in the light of our pet theories and a priori expectations. We indulge in wishful thinking and self-serving distortions of reality. We accept second-hand information and distortions introduced by others who summarise.

To truly appreciate the complexities of the impact of the Internet on the library bottom line, library managers and staff must develop an understanding of how the apparent evidence can be quite misleading. All concerned must think clearly about the actual experience, in the particular library, rather than libraries in general; must identify and question all assumptions; and must challenge clearly what we think we know in order to ensure that the financial and productivity benefits of the Internet are fully realised while its negative impacts on the library's bottom line are minimised.

REFERENCES

Drucker, P F (1993). Post-capitalist society. New York: Harper-Business, FSA 94 abstract 12148

Koopman, A and Hay, S (1994) 'Swim at Your Own Risk - No Librarian on Duty: Large-Scale Application of Mosaic in an
Academic Library' URL:http://www.ncsa.uiuc.edu/SDG/IT94/Proceedings/LibApps/hay/WWWPap.html

Lepani, B (1996) 'Technology and Learning: A Catalyst for the Re-design of Teacher's Work'. Paper presented at the School
Library Association of Queensland Conference, Brisbane, 26-27 June

Ward, A [ ], quoted in Gilovich, T (1991) How We Know What Isn't So: The Fallibility of Human Reason in Everyday Life.
Free Press, New York, p 1

Zuboff, S (1988) In the Age of the Smart Machine. Basic Books, New York.

NOTES